Our latest blog was written by Mark Jackson, Client Services Manager, an expert in the financial services sector. Keep your eyes peeled for more from Mark in the coming months!
It’s no secret that travel was adversely affected by the coronavirus pandemic- at one point in 2020, the TSA processed just 90,510 passengers in a day, a far cry from the 2.4 million processed in 2019. And while in the three years since the pandemic began, pure leisure travel has rebounded to pre-pandemic levels, business travel has not. The American Hotel & Lodging Association sees hotel business travel revenue down 23% in 2022 compared to 2019, and Skift predicts total global business travel won’t reach pre-pandemic levels until 2024. What type of traveler might bridge the gap? Enter, the “bleisure” traveler, and their growing influence is not only something hoteliers and airlines should pay attention to—credit card issuers should think closely on how to capture their attention as well.
What Is Bleisure Travel?
Bleisure travel is a movement that wasn’t quite possible before the pandemic. Many companies still have remote work policies in place, or at least some sort of blended in-office/work-at-home schedule. These location-agnostic employees are adding on extra days to once purely leisure trips, or traveling to a leisure destination to work remotely. And it’s a lot of travelers- according to the Wall Street Journal, pre-pandemic business travelers generated 50% of airline profits, while only representing 12% of total travelers. Now, American Airlines is reporting 45% of its business from “blended travel.”
These customers aren’t traditional business travelers, often splurging for perks that leisure travelers go for, like extra legroom, paid business class upgrades, and nicer hotel room views. And while some companies are calling their workers back into the office, the fact remains that a large subset of travelers will continue to mix business and leisure traveler into the future as more flexible work policies remain.
How Credit Card Issuers Can Address the Needs of the Bleisure Traveler
Credit card issuers have long divided up their card marketing efforts into personal and business cards, and to be sure, business credit cards with travel perks have long existed. The American Express Business Platinum card, for example, offers perks that both business owners and frequent travelers would enjoy, including access to their network of premium Centurion Lounges in airports around the US, and even London and Hong Kong. And, with their yearly statement credits for Dell products and Adobe subscriptions, it delivers value for small business owners that are hyper-focused on expenses, too.
But, what can card issuers do to better address the needs of the location-flexible, full-time employee? While statement credits from traditional business cards have been helpful for small business owners’ expenses for office needs, the bleisure traveler is more concerned about their personal expenses. With the rise of better access to information to save money on vacation, like blogs and even social media influencers on platforms like TikTok, a unique experience means everything. Brand affinity may not be as important as the cost of travel or the quality of a more bespoke offering, or at least the traditional ones that issuers have focused on in the past. This puts traditional co-branded offerings at a disadvantage when being marketed to this group of bleisure travelers. Reaching this group of travelers requires out-of-the-box affiliate marketing strategies. Rakuten can help publishers target this group, and our compliance tools and processes will ensure such initiatives will be reviewed and monitored to avoid operational risk.
Perhaps offering statement credits for more flexible lodging platforms like VRBO or Airbnb (or a way to save on their onerous fees) would appeal more to this burgeoning group of travelers, as “business” trips are extended to longer periods of time on a “bleisure” work-cation. It still leans into the strong brand awareness of these companies within this cohort of cost-conscious bleisure travelers, who would appreciate the savings, and still provide a way for issuers to access a built-in audience for their new card product. Rakuten offers card-linked offers for brands looking to partner with card issuers for online and in-person shopping, a great first step to test these theories. Publishing sites can take this data and marry card benefits to their content, driving conversions and a great experience for readers- they’re saving even more money, after all!
The same thinking goes for getting to their destination- airline-agnostic statement credits or perks that waive wifi access costs, extra legroom upgrades, or free drinks would appeal to this group of individuals. Younger travelers in Gen Z are representing more and more of the workforce, and this flexibility is greatly valued.
When it comes to spending on the bleisure credit card, a focus on what travelers spend at home is just as important as where they use their card on vacation. This group of cardmembers want to know that their spending will benefit them when it comes time to work remotely. Even more importantly, when it comes time to redeem those rewards, it should be as simplistic and easy as possible.
In the past decade, bank currencies that are transferrable to award programs have been in vogue, to the benefit of savvy travelers and travel brands issuing these currencies (one could argue that airlines are flying now for their main customer, credit card holders, not frequent flyers). Much like real fiat currencies, when more of that currency is printed or issued, inflation occurs. The exact same thing has been occurring in the travel rewards space- for example, American Airlines is switching to dynamically priced flight award in 2023, more tied to the actual price of the flight being redeemed for. The bleisure traveler will want their redemption options to be flexible and available, something that many personal and business credit cards haven’t addressed concurrently. This group of potential cardmembers would welcome innovation in this space.
Overall, the bleisure traveler is just beginning to make an impact in the travel world, albeit an already outsized one. While travel brands are seeing the impact in real-time, the financial world should pay close attention to how to address the needs of this new potential customer. The issuer that cracks the code on how to properly attract and retain these members may reap incredible rewards themselves. And, by partnering with Rakuten, financial institutions can rest easy knowing that our best-in-class compliance tools and processes support brand health and legal cooperation that reduces the burden of regulatory oversight.
To learn more about our finance offerings and additional insights, check out our 2023 Financial Affiliate & Consumer Trends Report.